Staccato is a way in which a note is played. When a note is played "staccato" the duration of the note is played to its minimum. It's a short and quick note essentially. Your attack on the note is quick and the note is promptly muted. It is marked in standard notation by a dot placed just below or above the head of the note.

Tenuto would be the opposite, where the note is stretched out for as long a duration as possible given it's value.

It's primarily a shorthand way of notating different feels. To write out a passage of 16th notes followed by a 16th rest then an 1/8 rest would be exceedingly time consuming as opposed to just putting a little dot over a quarter note.

As my esteemed colleague pointed out, it becomes almost a shorthanded way or writing something. I also think it describes feel too.

In 4/4, if I want to write straight quarter notes for a bar, I know that each note with take up one beat. I can divide one of those notes, and make it two eights notes. Now I've got a different feel. I can further take one of the eighth notes and make it into a rest. I still believe that placing a staccato quarter note in there is a different feel than an eighth note and an eighth rest. I'm not really sure if I'm describing it correctly though.

Maybe part of it is in the attack of the note. I'm not at my computer, otherwise I would write something out in Finale and show you the difference in the two. I think it comes down to attack and feel. Try clapping the beats and singing notes for the beats, and see how it feels.

I'm betting that Gard or JimK could explain this MUCH better than I'm doing right now.

Ackchuallee, PAZZTHROW (my esteemed colleague ), you've done a typically spot-on job of describing it. There is a decided difference between the 16th thing I used and staccato, but it's very difficult to put in words, much much easier to play an example for someone. The 16th note stuff was the best way I could think of putting it in words. Sorry for it's shortcomings.